The Signal Mountain Town Council is moving to begin regulating short-term rentals within town limits. Several related ordinances were passed at the council's May 14 meeting and are expected to be voted on again June 10.

One establishes a permitting process for short-term rentals, along with regulations and requirements for their operation. Another amends the town's zoning ordinance to include short-term rentals.

Regulations established in the first ordinance are consistent with what is allowed by state law, which limits local governments' ability to regulate short-term rentals. Those regulations include limiting the number of guests to eight at a time, prohibiting rentals of less than 24 hours, and requiring owners to provide adequate parking and collect applicable taxes.

While the ordinance includes a grandfather provision for existing short-term rentals, the owner would need to have followed all applicable state and county laws and requirements, including paying hotel-motel taxes, all along in order for the provision to apply.

If the ordinance is passed on second reading, short-term rental property owners who fail to acquire a permit or follow the rules outlined could face steep fines if another ordinance introduced May 14 passes. That ordinance would allow the town's administrative hearing officer to hear violations of local zoning ordinances.

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Boyd Veal

In 2017, state law was changed to allow administrative hearing officers — who were previously limited to hearing building code violations — to hear locally enacted zoning ordinances, including those regulating short-term rentals, said Town Attorney Harry Cash.

While the municipal court can only levy fines up to $50 for violations, administrative hearing officers can fine people up to $500.

"When you're dealing with business entities and such that are operating, having more of a significant authority on fining can be beneficial in getting issues resolved," said Town Manager Boyd Veal.

Charlie Poss, who has served as the town's administrative hearing officer for several years, is only paid when the town utilizes his services, Veal said, and that will not change.

A public hearing on the ordinance pertaining to zoning is scheduled for the council's June 10 meeting, when the council is expected to take its final vote on all three ordinances related to short-term rentals.

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